BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON NATURAL RESOURCES AND WATER
                             Senator Fran Pavley, Chair
                                2015 - 2016  Regular 

          Bill No:            AB 1205         Hearing Date:    July 14,  
          2015
           ----------------------------------------------------------------- 
          |Author:    |Gomez                  |           |                 |
           ----------------------------------------------------------------- 
           ----------------------------------------------------------------- 
          |Version:   |May 5, 2015    Amended                               |
           ----------------------------------------------------------------- 
           ----------------------------------------------------------------- 
          |Urgency:   |No                     |Fiscal:    |Yes              |
           ----------------------------------------------------------------- 
           ----------------------------------------------------------------- 
          |Consultant:|Katharine Moore                                      |
          |           |                                                     |
           ----------------------------------------------------------------- 
          
             Subject:  The California River Revitalization and Greenway  
                              Development Act of 2015.


          BACKGROUND AND EXISTING LAW
          California has over 46,000 miles of perennial (year round)  
          streams located throughout the state. River parkways, including  
          those in urban areas, are some of the most sensitive and  
          ecologically important conservation areas in the state.  They  
          may provide crucial riparian habitat for multiple species -  
          including endangered and threatened species - and also provide  
          important open space for communities.  Many communities,  
          particularly urban communities, are "park poor."  These  
          communities have insufficient open space areas nearby and lack  
          ready access to public recreational opportunities afforded by  
          proximity to trails, parks and open space.

          Existing law authorizes the Department of Water Resources to  
          establish a program of flood damage reduction and urban creek  
          restoration known as the Urban Streams Restoration Program  
          (Water Code §7048).  Since 1985, the program has provided more  
          than 270 grants ranging from $1,000 to $1 million to communities  
          throughout California for projects ranging from bank  
          stabilization to the occasional acquisition of strategic  
          floodplain properties or easements.  The last funding cycle for  
          the program was in 2014, where over $8 million was awarded to 13  
          project proposals.

          Existing law establishes the California River Parkways Program  







          AB 1205 (Gomez)                                         Page 2  
          of ?
          
          
          (Public Resources Code (PRC) §§5750 et seq.) under the  
          administration of the Secretary of the Natural Resources Agency  
          (agency).  It requires the agency to provide grants for river  
          parkway projects that acquire land for river parkways or for the  
          restoration, protection, and development of river parkways.  The  
          agency is currently soliciting for a one-time funding round of  
          approximately $7.6 million for the acquisition, restoration,  
          protection and development of river parkways.  The funds for  
          this cycle are the last of the Proposition 84 funding for the  
          program. Eligible entities include public agencies and  
          non-profits.

          Additionally, the agency administers other grant programs,  
          including the Urban Greening for Sustainable Communities (on  
          behalf of the Strategic Growth Council) and the Environmental  
          Enhancement and Mitigation Program that river restoration and  
          related projects may be eligible for and have received funding  
          from.

          Further, various state bond acts and legislative appropriations  
          have repeatedly provided moneys, through a variety of programs  
          and mechanisms, for river and stream restoration.  State-level  
          organizations providing grants for these purposes include the  
          Department of Fish and Wildlife; the Wildlife Conservation  
          Board; various Conservancies, including the State Coastal  
          Conservancy, the San Joaquin River Conservancy, the Santa Monica  
          Mountains Conservancy, the Strategic Growth Council, and  
          CalFIRE, among others.  

          Most recently, in November 2014, voters approved the Water  
          Quality, Supply, and Infrastructure Improvement Act of 2014  
          (Proposition1).  Proposition 1 authorizes $7.545 billion in  
          general obligation bonds to fund ecosystem and watershed  
          protection and restoration, water supply infrastructure  
          projects, including surface and groundwater storage, and  
          drinking water protection.  More specifically, $1.495 billion is  
          designated for competitive grants for multibenefit ecosystem and  
          watershed restoration projects.  

          Pursuant to the California Global Warming Solutions Act (AB 32),  
          existing law requires the Air Resources Board (ARB) to adopt a  
          statewide greenhouse gas (GHG) emissions limit equivalent to  
          1990 levels by 2020 and to adopt rules and regulations to  
          achieve maximum technologically feasible and cost-effective GHG  








          AB 1205 (Gomez)                                         Page 3  
          of ?
          
          
          emission reductions (Health and Safety Code (HSC) §§38500 et  
          seq.).  As part of the implementation of AB 32 market-based  
          compliance mechanisms, ARB adopted a cap-and-trade program that  
          caps the allowable state wide emissions of GHGs and provides for  
          the auctioning of emissions credits.  Auction proceeds are  
          deposited into the Greenhouse Gas Reduction Fund (GGRF) and  
          available for appropriation by the Legislature.

          Existing law establishes and authorizes expenditures from the  
          GGRF for investments that reduce GHG emissions associated with  
          water use and supply, land and natural resource conservation and  
          management, forestry, sustainable agriculture and other  
          purposes.  Existing law requires the Department of Finance, as  
          specified, to allocate at least 25% of available moneys in the  
          GGRF to projects that provide benefits to disadvantaged  
          communities and at least 10% to projects located within  
          disadvantaged communities (HSC §39713).

          Existing law also prohibits the state from approving allocations  
          for a measure or program using GGRF monies except after  
          determining that the use of those moneys furthers the regulatory  
          purposes of AB 32 (HSC §39712).

          The 2014 - 15 Budget Act allocated cap-and trade revenues for  
          the 2014 -15 fiscal year and established a long-term plan for  
          the allocation of cap-and-trade revenues beginning in fiscal  
          year 2015 - 16.  The Senate Environmental Quality Committee  
          analysis of this bill includes a detailed review of the auction  
          revenue expenditures and requirements.  The 2015 -16 budget bill  
          passed both houses on June 15, 2015, but excluded any  
          appropriation of cap-and-trade auction revenue.
          
          PROPOSED LAW
          This bill would create a grant program called the California  
          River Revitalization and Greenway Development Act of 2015  
          (CalRIVER) and require the agency to administer the program.   
          Specifically this bill would:

          1)Declare legislative intent to protect, restore and enhance a  
            network of river systems and riparian corridors.

          2)Require the agency to develop a grant program for eligible  
            applicants to develop projects that assist with implementing  
            AB 32 and to prioritize funding projects that provide the  








          AB 1205 (Gomez)                                         Page 4  
          of ?
          
          
            greatest level of the following cobenefits:
             a)   Recreational access, as specified, especially in urban  
               corridors and under-parked communities.
             b)   Transportation mobility, especially pedestrian, bicycle,  
               and public transit.
             c)   Economic viability by promoting appropriate development,  
               as specified.
             d)   Development of visitor-serving and interpretative  
               facilities
             e)   Access and development of pocket parks, community  
               gardens, demonstration gardens and other urban greening.
             f)   Species protections and the protection of habitat  
               strongholds, including improved wildlife corridors.
             g)   Improved resiliency to climate change impacts.
             h)   Improved water supply and quality.
             i)   Job training and workforce development, as specified.
             j)   Improved stormwater retention.
             aa)  Improvements along impaired water bodies.

          3)Requires projects receiving grants to be consistent with AB  
            32, the California Water Action Plan, the Safeguarding  
            California Plan and SB 535 (de León, c. 830, Statutes of  
            2012).

          4)Requires the agency to prioritize awarding grants to projects  
            that are consistent with a parkway, greenway or urban greening  
            plan, leverage Proposition 1 funds, and provide recreational  
            access to a major metropolitan area of the state.

          5)Creates the CalRIVER fund, as specified, to receive bond  
            proceeds and special funds, including, but not limited to,  
            auction revenues from the GGRF.

          6)Makes various supporting legislative findings, as specified.

          ARGUMENTS IN SUPPORT
          According to the author, "Given the vast potential for using our  
          river systems to reduce and sequester greenhouse gas emissions,  
          and no existing integrated, statewide grant program to deliver  
          these benefits, this bill would establish CalRIVER."

          "The program would be especially useful in incentivizing  
          projects that integrate stormwater, natural resource  
          improvements, as well as reduction in vehicle miles traveled.  








          AB 1205 (Gomez)                                         Page 5  
          of ?
          
          
          Without CalRIVER, the state would continue to miss the  
          opportunities to harness the climate values of our riparian  
          corridors for greenhouse gas reductions, as well as the many  
          other cobenefits associated with these projects."

          ARGUMENTS IN OPPOSITION
          According to the California Taxpayers Association, "AB 1205  
          would make cap-and-trade funds available for use by the Natural  
          Resources Agency in administrating the CalRIVER Fund to provide  
          funding for park and recreational programs, and water supply and  
          water quality programs. CalTax is opposed to the bill because it  
          distorts the nature of a regulatory fee. [?] Pending litigation  
          will determine if the auction component of the cap-and-trade  
          program constitutes an illegal tax. By directing funds beyond  
          the clear regulatory purposes, AB 1205 opens up the  
          cap-and-trade program to litigation risk."

          
          COMMENTS
           CalRIVER is a targeted program.   The legislative intent section  
          of this bill makes clear that the intent of the CalRIVER program  
          is GHG emissions reduction and carbon sequestration while at the  
          same time achieving the multiple cobenefits possible through  
          river restoration and related projects, as specified.  This  
          focus becomes slightly muddled later in the bill.  Discussions  
          with the author's office indicate that the bill's intent is to  
          provide additional resources, but not replace, existing programs  
          established for river restoration and related projects.  The  
          committee may wish to amend the bill to clarify this point.  
          [Amendment 1]  

           Implementation of the program  .  The statutory language for many  
          grant programs includes specific direction to the grantor to  
          develop the program.  The committee may wish to provide specific  
          direction to the agency secretary to do so. [Amendment 2]

           Litigation over auction revenue.   In 2012, the California  
          Chamber of Commerce filed a lawsuit against ARB claiming that  
          cap-and-trade auction revenues constitute an illegal tax.  The  
          Superior Court ruling in late 2013 found that the auction is  
          more akin to a regulatory fee than a tax.  An appeal of that  
          decision is pending.  However, the committee may wish to require  
          additional language to more explicitly tie the CalRIVER program  
          into the statutory and regulatory framework developed to ensure  








          AB 1205 (Gomez)                                         Page 6  
          of ?
          
          
          that GGRF moneys further the regulatory purposes of AB 32  
          [Amendment 3]

           Technical and clarifying changes  .  The committee may wish to  
          make a series of minor technical and clarifying changes to the  
          bill to help ensure the bill's intent is realized. [Amendment 4]

           Late "support if amended" letter  .  A late letter signed by  
          several community-based organizations expressed qualified  
          support for AB 1205, and requested several amendments. The  
          letter expresses concerns about CalRIVER supplanting existing  
          river and stream restoration programs, such as the Urban Streams  
          Restoration Program, and requests the provision of base funding  
          for existing river/stream programs, the removal of any  
          prioritization for urban areas, assurance that all river grant  
          programs have tools to meet auction revenue requirements, and  
          the establishment of a program or process to help communities  
          engage in the "often confusing state funding processes."

          As noted above, CalRIVER is a targeted program, and would be one  
          of many state programs that provide funding for river and stream  
          restoration.  While many river and stream restoration efforts  
          may have climate value, it is not clear that all efforts will be  
          able to qualify for auction revenues.  There is therefore  
          benefit in having multiple programs established for river and  
          stream restoration with funding, subject to Legislative  
          appropriation, from a variety of sources.  Further, many  
          existing grant programs provide workshops and assistance to  
          those seeking funding without a specific statutory requirement.

           Rivers with plans.  According to the author's office, rivers  
          throughout the state are in the process of or have completed  
          restoration plans that could meet that priority criterium  
          established in this bill.  These include the San Joaquin, Eel,  
          American, San Diego and Los Angeles Rivers.  These plans contain  
          rural reaches.  There have also been considerable efforts  
          undertaken in recent years to revitalize the Los Angeles River.   
          Both the County (1996) and the City (2007) of Los Angeles have  
          released revitalization plans, and the US Army Corps of  
          Engineers recently approved the most extensive restoration  
          alternative for its Ecosystem Restoration Feasibility Study for  
          the Los Angeles River.  Currently, the LA River's "Greenway  
          2020" plan calls for public/private efforts to achieve a  
          continuous 51 mile greenway along the Los Angeles River by 2020  








          AB 1205 (Gomez)                                         Page 7  
          of ?
          
          
          to facilitate non-vehicular modes of transportation and  
          recreational access, among other goals.  There have also been  
          several pocket parks added along the Los Angeles River in recent  
          years.
           
          Double-referral
           This bill was heard earlier in the Senate Environmental Quality  
          Committee.  Elements of the bill under that Committee's  
          jurisdiction are provided here for context and completeness.

           Recent related bills
           AB 1251 (Gomez, 2015). This bill would establish the Greenway  
          Development and Sustainment Act which, among other things,  
          provides for greenway easements. (before the Senate  
          Appropriations Committee)
          
          AB 530 (Rendon, 2015).  This bill would establish the Lower Los  
          Angeles River Working Group to develop a revitalization plan for  
          the Lower Los Angeles River. (before the Senate Natural  
          Resources and Water Committee)

          AB 735 (Gomez, 2013). This bill would have established the  
          Greenway Initiative to promote the establishment of greenways  
          along rivers statewide (held in the Assembly Appropriations  
          Committee)

          AB 1922 (Gomez, 2014). This bill is an earlier version of AB  
          1251 (Gomez, 2015) (held in the Senate Appropriations Committee)
          
          SUGGESTED AMENDMENTS 
          
          AMENDMENT 1
               On page 4, lines 9 & 10, delete "river parkway and urban  
               creek programs and"

          AMENDMENT 2
               On page 4, insert after line 11:

               "5849. The secretary shall develop regulations, criteria,  
               or procedural guidelines for the implementation of this  
               chapter."

          AMENDMENT 3
               Delete page 2 lines 32 -33 and page 3 line 1-3 and replace  








          AB 1205 (Gomez)                                         Page 8  
          of ?
          
          
               with:

               "to riparian corridors that furthers the regulatory  
               purposes of the California Global Warming Solutions Act of  
               2006 (Division 25.5 (commencing with Section 38500) of the  
               Health and Safety Code) and   meets the requirements of the  
               Greenhouse Gas Reduction and Communities Revitalization Act  
               (commencing with Section 39710) of the Health and Safety  
               Code).

               (b) In order to eligible for funding under the program, a  
               project shall demonstrate that it will achieve a reduction  
               in emissions of greenhouse gases. In selecting projects for  
               funding, the Natural Resources Agency, in consultation with  
               the California Air Resources Board, shall consider the  
               extent to which a project reduces emissions of greenhouse  
               gases.

               (c) In evaluating grant applications for funding, the  
               Natural Resources Agency shall, in addition to prioritizing  
               projects pursuant to subdivision (b), consider the extent  
               to which projects provide the greatest level of the"

          AMENDMENT 4
               On page 2, line 28, delete "and improve," delete line 29  
               and replace with:

               "increase active transportation, such as biking and walking  
               and improve non-motorized mobility in the surrounding  
               communities and decrease vehicle miles traveled."

               On page 3, line 5, add "to" between "access" and "and" 

               On page 3, line 5, delete "interactions," and replace with  
               "interaction with a river or riparian corridor,"

               On page 3, line 7, insert "Improved" before  
               "transportation"

               On page 3, line 9 insert "of the surrounding community"  
               after "viability"

               On page 3, delete line 18 and replace with:









          AB 1205 (Gomez)                                         Page 9  
          of ?
          
          
               "(8) Improved water supply, flood protection and water  
               quality, including the water quality of impaired water  
               bodies through river restoration."

               On page 3, delete line 22.

               On page 3, line 23, replace "(b)" with "(d)" and insert  
               "also" after "shall"

               On page 3, delete lines 25 - 27, inclusive.

               On page 3, delete line 31.

               On page 3, between lines 31 and 32 insert:

               "(e) projects receiving funding pursuant to this chapter  
               for flood protection shall be consistent, as applicable,  
               with Chapter 4 (commencing with section 8400) of Part 2 of  
               Division 5, Part 6 (commencing with section 9600) of  
               Division 5, and Part 9 (commencing with Section 12980) of  
               Part 6 of Division 6, of the Water Code."

               On page 3, line 32, replace "(c)" with "(f)."

               On page 4, delete lines 1 - 2, inclusive, and replace with:

               "(3) Provide recreational access and opportunities to major  
               metropolitan areas of the state, including those that are  
               relatively underserved by parks."

          SUPPORT
          Audubon California
          California League of Conservation Voters
          California Trout
          Los Angeles County Board of Supervisors
          Los Angeles River Revitalization Corporation
          Sierra Club California

          OPPOSITION
          California Taxpayers Association

          
                                      -- END --
          








          AB 1205 (Gomez)                                         Page 10  
          of ?